Indian rupee ended lower on Monday tracking a negative trend in domestic equities. Foreign fund outflows also weighed on the local unit. Traders were worried as Reserve Bank said India’s forex kitty decreased by $462 million to $590.321 billion for the week ended November 10. In the previous reporting week, the overall reserves had increased by $4.672 billion to $590.783 billion. Meanwhile, S&P Global Ratings said the hike in risk weights for consumer loans like personal loan and credit cards may shave-off tier I capital of banks by 60 basis points, hit loan growth, and squeeze the nonbank sector in particular. S&P Global Ratings credit analyst Geeta Chugh said the finance companies will be worse affected as their incremental bank borrowing costs will surge, in addition to the capital adequacy impact. On the global front, dollar slid to a more than two-month low on Monday, extending a downtrend from last week as traders reaffirmed their belief that U.S. rates have peaked and turned their attention to when the Federal Reserve could begin cutting rates.
Finally, the rupee ended at 83.37 (Provisional), weaker by 11 paise from its previous close of 83.26 on Friday. The currency touched a high and low of 83.37 and 83.23 respectively.
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